Acta Oeconomica 26. (1981)
1981 / 1-2. szám - Molnár, F.: Consumers' Investment Versus Capital Investment
134 F. MOLNÁR: CONSUMERS’ INVESTMENT VERSUS CAPITAL INVESTMENT conflict with reality) which describe the real world more or less accurately.” ([22] pp. 9-11) I do not, indeed, regard the views presented in this short study a system of ideas, but I do hope that they can contribute to the elimination of conflict between theory and experience in the field studied here, and its readers will increase the number of those, . . who, following their intuitions, have preferred to see the truth obscurely and imperfectly rather than to maintain error, reached indeed with clearness and consistency and by easy logic, but on hypotheses inappropriate to the facts.” ([20] p. 371) The story of an idea in a nutshell I consider it opportune to make the reader familiar with the long road leading to the formation of the ensemble of views to be presented on the following pages. I have to go rather far back in time. In 1962, while working on my dissertation for the degree candidate of science*, I found the statistics of US economic development in the one and a half decade following World War II showing that the share of purchases of consumer durables and residential construction (for the group formed by these two items I coined the term: consumers’ investment) increased considerably within total demand (GNP). As I also observed in the movement of this group a certain cyclicality which, however, did not coincide in time with the cyclicality of fixed business capital investment, I took the courage to state that “Their increased importance creates a second material basis for the periodicity of crises,” adding, however, that this ”... is not meant to equate qualitatively the importance of fixed capital investment, and consumers’ investments as regards their role in the reproduction cycle.” ([24] pp. 34—38 and 235) When in two of my later articles I could follow up the statistical analysis to 1973 ([27 and [28]), I felt my idea gathered strength. Even more, my conviction about the outstanding importance of consumer investment became an essential element in formulating my standpoint which stated that “. . . At present the process of capitalist reproduction need not necessarily be cyclical and is, in fact, not cyclical...” ([26] p. 376).** At that time this standpoint brought about a lively discussion and also some arguments, serious and worth to consider, were raised against it. ([11]) Studying the development of the most severe recession of the post-World War II period — that of 1974—75 — I could state with firm conviction on the basis of the statistical evidence that ”... the recession was first of all brought about by the sharp decrease in consumers’ investment and not by the fall of business fixed investment.” ([25] p. 184) *The equivalent of a Ph. D. in the USA. **Namely, I was, and still am, of the opinion that „. . . by a cyclical movement... We mean also that there is some recognizable degree of regularity in the time sequence and duration of the upward and downward movements.” (120] p. 314) Acta Oeconomica, 26, 1981